Kenya saw the number of fintech start-ups increase by 21.5 percent, up from the 15.4 percent recorded in 2019.
Data from the latest Disrupt Africa report has revealed that the number of fintech startups in the continent grew by 17.3 percent to 576 in 2021, Kenya being among the dominant countries with 93 new startups.
The West Africa region is leading the pack with Nigeria’s figures up 42.6 percent on 2019 numbers.” In Ghana, fintech companies grew by 25 percent over the same period while Ivory Coast’s count was up 100 percent.
From the findings, however, Nigeria, South Africa, and Kenya remain the dominant countries in the fintech space.
The study showed that of all the startups tracked between 2019 and 2021, a total of 391 were found in these three countries.
Of the 391 fintech startups, 154 were located in South Africa, 144 in Nigeria, and 93 in Kenya.
This growth has been attributed to the COVID-19 related restrictions. For example, following the marginal drop of 2019, the number of payments and remittances from fintech startups increased in the three countries.
In South Africa, the payments and remittances rose by 27.3 percent, 7 percentage points higher than its growth rate in 2019.
Kenya, on the other hand, saw the number of fintech start-ups increase by 21.5 percent, up from the 15.4 percent recorded in 2019.
Nigeria, which has continually outperformed South Africa and Kenya, recorded a 33.3 percent increase. However, the figure was a negligible increase from 2019’s data where it recorded a growth rate of 32.7 percent.
Overall, the number of fintech start-ups in Africa has increased around 90 percent from the 2017 figure of 301.
Nigerian fintech startups also led in terms of funds raised. The country has since remained the market leader for more than half a decade.
“Of the 277 fintech funding rounds tracked by Disrupt Africa between 2015 and mid-2021, 108 of these rounds went to Nigerian startups, totaling 467,901,000 dollars in investment and accounting for 53.4 percent of funds raised since tracking began. This is a far higher total dollar amount than any other country in Africa,” noted the report.
South Africa raised a total of over 216 million dollars over the same period.
On top of tracking new startups, the Disrupt Africa study also recorded the number of fintech failures. It stated that 109 of the fintech ventures featured in the 2019 edition of the report have since closed their doors.
“That represented 22.2 percent of the 2019 total. Closures in and of themselves are obviously not positive things, but the countries and verticals in which most of these ‘fails’ have taken place suggest a market that is correcting itself,” the report adds.
Interestingly, the Disrupt Africa study found that more fintech start-ups now have operations in more than one category. As the findings show, the continent had 143 multi-category fintechs operating in 2021, against the 73 that were seen in 2019.
Leading in this category is Nigeria which has 39 followed by South Africa which has 31 while Kenya is not far behind with 30.